What is a Protocol?
In DeFi, a protocol is a collection of smart contracts that work together to provide a financial service. Examples include lending protocols, DEXs, and staking services.
Protocol Components
- Smart contracts (core logic)
- Frontend (user interface)
- Governance (decision making)
- Treasury (protocol funds)
Evaluating Protocols
- Audit status
- TVL and user adoption
- Team and governance
- Track record